Geithner knew financial recovery would be hard

Former Treasury Secretary Timothy Geithner said Sunday that he foresaw the factors leading to the financial collapse of 2008 and 2009, and knew that recovery efforts would be politically unpopular.

“This country had a long boom in borrowing and leverage, a huge build-up in risk,” he said Sunday on CBS's “Face the Nation.” “And a lot of that risk ended up outside the former banking system, in places where it couldn’t be contained, and where the government had no standing authority to prevent panics.”

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Geithner was president of the Federal Reserve Bank of New York before leading the Treasury Department from 2009-2013. He came to “Face the Nation” to promote his book Stress Test: Reflections on Financial Crises, in which he writes that he saw problems in the financial system before the collapse.

Geithner also said he did not want President Obama to ask him to lead the Treasury.

“I knew it would be terrible, and I tried to talk the president out of asking me to do it, because I didn’t want to move my family, and I knew it was going to be hard,” he said, referring both to the job and the efforts to restore the financial system.

He said he knew that the Troubled Asset Relief Program, passed in October 2008 to strengthen the banking sector, would be controversial because “it looks like you’re giving aid to the arsonists.”

Geithner also praised Obama’s leadership.

“I had an amazingly good experience with this president in this White House, in the sense that my overwhelming experience was that this was a man very good at making decisions — unpopular decisions — after looking at all the evidence, who was willing at that time to put policy ahead of politics in a way that was very important for the country,” he said.